Author Archives: Fozeia Rana-Fahy

In the matter of G Trust [2017] SC (Bda) 98 Civ (15 November 2017)

In the 2015 case of Re BCD Trust (confidentiality Order) [2015] Bda LR 208, the Chief Justice had confirmed that with respect to administration of trust cases, proceedings could be anonymised and dealt with as private applications where there was no obvious public interest in knowing about an internal trust administration matter.

In a recent ruling from November 2017, the Chief Justice has re-confirmed his previous finding with respect to confidentiality orders in the context of trust administration matters.
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Meritus Trust Company Limited v Butterfield Trust (Bermuda) Limited [2017] Bda LR 82

In October 2017, Chief Justice Kawaley ruled that an outgoing trustee is neither entitled to retain any part of the trust assets as security for its equitable indemnity as former trustee nor demand a contractual indemnity.

This case involved an outgoing institutional trustee who upon being removed (as opposed to having retired) as trustee of two trusts, refused to hand over sizeable trust assets or trust documents to the new trustee without first obtaining a contractual indemnity and retention of assets from the two trusts. This was against the backdrop of a potential breach of trust claim of an approximate value of $5 million. The trust deeds did not confer any express retention or contractual indemnity rights on the former trustee.
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The Chief Justice has recently considered the impact of the Children Act 1998 (“the Act”) as amended by the Children Amendment Act 2002 (“the 2002 Amendments”) upon the ability of trustees to change the governing law of a foreign law trust to Bermuda.

The 2002 Amendments, which came into force in January 2004, created a new rule for construing all instruments, including international trusts. On one reading of the Act, a person can no longer validly give a gift or make dispositions of property to their “legitimate children” only (unless each legitimate child is identified by name), since such a gift/disposition would be construed as a gift/disposition to their legitimate and illegitimate children.
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The Transcontinental Trusts International Forum 2017 took place earlier this month on 4-5th May 2017 at the Fairmont Southampton. This conference began in Bermuda in 2015 and has grown hugely in popularity as one of the key events on the private client calendar. This year it was attended by leading international experts, lawyers and barristers from the international and local private client market as well as renowned international judges. The whole event received an extremely favorable response from speakers and delegates alike. Topics covered included the impact of Brexit and the US election on the industry, practical consequences flowing from CRS & FATCA, an international litigation update, family governance and tax changes in the US and UK. Furthermore, data protection was highlighted in several of the sessions as an area to look out for.
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In the Matter of the C Trust [2016] SC [Bda] 53 Civ was the first Bermuda case to extend the perpetuity period under the new Section 4 of the Bermuda Perpetuities and Accumulations Act 2009 (“the 2009 Act”). The amendment to Section 4 took effect in December 2015. Although prior to the amendment, the 2009 Act had already abolished the rule against perpetuities with respect to instruments taking effect on or after 1 August 2009, the rule continued to apply to trusts established under Bermuda law prior to 1 August 2009 as well as to trusts originally established in other jurisdictions (with an applicable perpetuity period or similar limitation) but now governed by Bermuda law.

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